Business outlook dims in Norway's oil region -survey

Reuters Staff

2 Min Read

OSLO, Sept 6 (Reuters) - Business conditions remained strong in Norway’s western oil-producing regions during the summer months, but companies increasinly worry over the outlook for the coming quarters, a sentiment survey showed on Wednesday.

The price of crude oil, Norway’s key export, fell sharply from mid-2014 to early 2016 but has since staged a partial recovery, while non-oil exporters are boosted by a weak crown currency.

The West Coast Current Conditions Index rose by 0.6 points to 61.5 points, the highest since late 2014, while the six-month outlook fell by 0.9 points to 64.5 points, the survey by Respons Analyse and Sparebanken Vest showed.

“Expectations of lower demand, profitability and employment are the main reasons for the more negative outlook,” Sparebanken Vest said.

Norway will hold an election for parliament on Sept. 11 to decide whether Prime Minister Erna Solberg’s right-wing minority government should stay in power, or if a centre-left coalition headed by Labour will win.

Recent opinion polls show the election race remains too close to call, and that the outcome from the close-fought western regions may ultimately determine the result.

The business survey was first compiled in 2012 and includes 700 firms based in the regions of Rogaland, Hordaland, Sogn og Fjordane and Moere og Romsdal. Readings above 50 indicate expansion, while a reading below that level signals contraction. (Reporting by Camilla Knudsen, editing by Terje Solsvik)